KUALA LUMPUR: The government will call for a tender by the year-end to set up a privately-financed asset company (AssetsCo) for the Kuala Lumpur-Singapore High Speed Rail (HSR) project, said MyHSR Corporation Sdn Bhd chief executive officer Mohd Nur Ismal Mohamed Kamal.
This will be the first tender given out for the HSR project.
AssetsCo will be responsible for the design, build, finance and maintain rolling stock and to design, build, finance, operate and maintain rail assets such as track-work, power, signalling and telecommunications.
“We are transitioning from the development phase to the implementation phase where we have hired our civil reference designers and consultant adviser for the system site (railway system) jointly with Singapore.
“We are working hard towards the procurement stage, which will be the start of the construction phase, and for AssetsCo, we are targeting by end of this year,” he told reporters on the sidelines of the “Third HSR Symposium in Malaysia” yesterday.
Also present were Land Public Transport Commission (SPAD) chairman Tan Sri Dr Syed Hamid Syed Jaafar Albar and Japanese Minister of Land, Infrastructure, Transport and Tourism, Keiichi Ishii.
Mohd Nur Ismal said MyHSR is currently evaluating the civil construction of the project and would propose the best approach to manage the work scope to the government.
He said the decision on the project delivery partner would be announced in the first quarter of next year, soon after calling the tender for AssetsCo.
Asked on funding for the civil infrastructure, he said the company is in the midst of identifying the best solution including an option to raise financing via sukuk.
“Let the government decide (on how to finance the HSR project),” he said.
Taking public infrastructure projects in Europe as an example, he said most of the capital expenditure (capex) would be provided by the government.
“The rail company actually has to take care of the operating cost, whereby they don’t have to pay for the capex. They will contribute, but not expected to pay for the full capex.
“So, when financing is structured that way, its viability is much shorter and easier,” he said.
Asked on the possible fare, Mohd Nur Ismal said this had been enshrined in the bilateral agreement signed between Malaysia and Singapore last year whereby both countries agreed to adopt the unregulated fare structure.
He said the operator was free to set its own fare but it would be affordable for the passengers.
“What we want to see a fare that is affordable to encourage ridership. We want to make sure the optimal ridership is achieved,” he added.
The KL-Singapore HSR will cut the travel time between the two cities to just 90 minutes with both countries committed to the project deadline in 2026.
The 350-kilometre rail line comprises eight stops in total — Bandar Malaysia, Putrajaya, Seremban, Ayer Keroh, Muar, Batu Pahat, Iskandar Puteri and Singapore.
In the fourth quarter of this year, Malaysia will issue the international tenders for the systems to be chosen for the HSR.
Japan has expressed its interest in the project that is estimated to cost between RM60 billion (US$13.6 billion) and RM65 billion (US$14.7 billion). — Bernama